Posts Tagged ‘college expenses’

Parent’s Obligation to Pay for College Is Not Limited To Cost of SUNY Education Unless Proven Otherwise

Sunday, November 13th, 2011

In Pamela T. v. Marc B., 2011 N.Y. Slip. Op. 21355 (N.Y.Sup.2011), the court had to decide whether the parent’s obligation to pay for college should be limited to the so-called “SUNY cap”. The Supreme Court concluded that parent’s argument that before a parent can be compelled to contribute towards the cost of a private college, there must be a showing that a child cannot receive an adequate education at a state college, has no basis in the law.

The parties were divorced on December 23, 2008 and have two sons, 18 and16 years old. Their judgment of divorce was silent as to the payment of the children’s college tuition and expenses.

In 2007, the older child was diagnosed with emotional and learning/anxiety disorders, which resulted in certain educational accommodations. Despite his disabilities, he graduated in 2011 from a selective public high school in Manhattan. He was accepted at Syracuse University, SUNY Binghamton and SUNY Buffalo, as well as other schools. The costs of college education varied from Syracuse at approximately $53,000 a year to attend, to SUNY Binghamton and SUNY Buffalo that cost about $18,000 a year. The child decided to attend Syracuse which he is now attending as a freshman.

The both parents are practicing attorneys in New York City. Plaintiff’s 2010 federal income tax return reported adjusted gross income of $109,896. Defendant’s 2010 federal income tax return reported adjusted gross income of $105,135. Plaintiff’s net worth statement showed she had assets of approximately $1,230,000. Defendant’s net worth statement showed he had assets of approximately $580,000. Both plaintiff and defendant went to private undergraduate colleges and law schools.

Defendant did not oppose an order directing him to contribute to his older child’s college education, but he requested that the court to apply the SUNY cap and limit his responsibility to a percentage of the costs of a state university education rather than to a percentage of a private college education. Defendant’s position was based on his claim that he was unable to meet the financial demands of paying for private college and on his belief that his son could receive as good an education at SUNY Binghamton as he could at Syracuse.

The court stated that Domestic Relations Law 240(1- b)(c)(7) gave the courts of this state the authority to “direct a parent to contribute to a child’s private college education, even in the absence of special circumstances or a voluntary agreement. The statute provides that when a court exercises its discretion to direct such a contribution from a parent, it is to do so “having regard for the circumstances of the case and the parties, the best interests of the child, and the requirements of justice.” The courts interpreted the provisions of DRL 240(1-b)(c)(7) by setting forth specific factors that are to be considered in determining whether to award college expenses. These factors include the educational background of the parents and their financial ability to provide the necessary funds, the child’s academic ability and endeavors, and the type of college that would be most suitable for the child.

The Court stated that DRL 240(1-b)(c)(7) does not provide for a SUNY cap. The SUNY cap appeared in a number of decisions rendered since the enactment of the statute. These cases have not provided an explanation as to when a SUNY cap might be properly applied over the objection of the parent who is seeking an award for college expenses.

The court found that Berliner v. Berliner, 33 A.D.3d 745, 749 (2d Dept. 2006) was instructive because in that case the Second Department stated that there “is no basis in this record” for imposing the SUNY cap implied that the burden falls on the proponent of the cap to demonstrate that it is warranted. The inference to be drawn is that there is no presumption that a parent’s obligation to pay for college is to be limited to the cost of a SUNY education unless proven otherwise; if anything, the presumption goes the other direction. It was also instructive because the decision’s reference to the “so-called SUNY cap” implied that even the Second Department views the SUNY cap as something less than an established doctrine.

The court rejected defendant’s argument that plaintiff be required to prove that Syracuse was a better school than SUNY Binghamton, in order for him to be required to pay Syracuse’s higher expenses. The decision noted that it is difficult to conceive of a workable procedure, let alone a methodology, for a court to make a finding that one college is “better” than another. The court found that there was sufficient showing to support the child’s choice of Syracuse, irrespective of whether it is ranked lower, higher or the same as SUNY Binghamton or any other SUNY school. If there are funds are available to finance the child’s education, the fact that Syracuse was a private school and cost more than a public school was not a reason to interfere with the child going to the school he chose and he wanted to attend.

The court further held that one of the factors to be considered when making a determination under DRL 240(1-b)(c)(7) is the parents educational background. Inasmuch as plaintiff attended Northwestern and defendant attended Columbia, the court could reasonably assume that there would exist an expectation in the family, and in the child himself, that he too could attend a private college.

Having found that defendant had to contribute to his son’s education at Syracuse University, the court had to consider the defendant’s ability to pay. It was defendant’s position that even though plaintiff may have the means to pay the high cost of their son attending Syracuse, he lacked the means to do so. Consequently, he argued that he should have to pay no more than $9,000 a year towards his son’s education, an amount that is roughly 50% of the present annual cost of a SUNY school.

The court rejected defendant’s contention as to his inability to pay a significant share of the child’s actual educational expenses being incurred at Syracuse. The court held that the parties’s incomes and assets would allow them to pay for their child’s education at Syracuse.

The court further held that there was no basis to impose the SUNY cap, to the extent that it should be imposed at all, where the party seeking to invoke the cap has the financial ability to contribute towards the actual amount of his or her child’s college expenses. Although defendant’s contribution should be less than plaintiff’s, based on the difference between their net assets, and in particular what each of them had available for eventual retirement, that contribution should not be subject to some artificial construct like the SUNY cap. On this basis, the court held that defendant shall be obligated to contribute 40% of the total cost of the older child attending Syracuse University, with those costs to include tuition, room and board, fees and books.

Thus, this decision confirms that if a parent is hoping to place a limit on future college costs, it is very important to include provisions in the parties’ separation agreement or settlement stipulation placing an upper limit on such costs.

Paying for College – A Requirement Under the Child Support Standards Act?

Monday, February 16th, 2009

Prior to the enactment of the Child Support Standards Act, contained in Family Court Act §413 and Domestic Relations Law §240, the courts had held that the provision of a college education to one’s minor children was not a necessary expense for which a parent could be obligated in the absence of a voluntary agreement or special circumstances. Haessly v. Haessly, 203 A.D.2d 700 (3d Dept. 1994). However, recent case law recognized that special circumstances, which involve the educational background of the parents, the child’s academic ability, and the parents’ financial ability to provide the necessary funds, continue to be relevant factors in applying the standard set forth by the Legislature in the Child Support Standards Act for determining whether an award for college expenses is appropriate.

It is clear that the Court has the power to order a parent to pay his child’s educational costs even though the parties’ settlement agreement is silent on that issue. Manocchio v. Manocchio, 16 A.D.3d 1126 (4th Dept. 2005); McDonald v. McDonald, 262 A.D.2d 1028 (4th Dept. 1999). As aptly noted in Mrowka v. Mrowka, 260 A.D.2d 613, 613 (2d Dept. 1999), “Although the parties’ stipulation of settlement was silent as to the costs of college, this does not necessarily mean that an agreement was reached pursuant to which college costs would not constitute a component of the parties’ obligation to pay child support.”

According to the Appellate Division, Fourth Department, Fruchter v. Fruchter, 288 A.D.2d 942, 943 (4th Dept. 2001), the Child Support Standards Act authorizes an award of educational expenses where warranted by the best interests of the children and as justice requires, upon a showing of “special circumstances”. Relevant factors include the educational background of the parents, the child’s scholastic ability, and the parents’ ability to provide the necessary funds. Id.

In Manocchio v. Manocchio, 16 A.D.3d 1126 (4th Dept. 2005), the Appellate Division, the Fourth Department, rejected the father’s contention that Family Court improperly denied his objection to an order requiring him to pay half of his daughter’s educational expenses. The Fourth Department held that the support magistrate properly determined that the petitioner-mother was unable to meet the child’s educational needs on the income and support that she was receiving, and that the respondent-father had the ability to pay support. Id.

Therefore, even if the parties have a separation agreement that is silent on the issue of paying for college, they may be directed to pay for their child’s college education by the court.

Opt-Out Agreements and the Scope of the Child Support Standards Act

Monday, December 29th, 2008

If parties choose to deviate from the provisions of the Child Support Standards Act with respect to the child support paid, such deviation will be upheld by the court provided the parties complied with such formalities as including calculations of the presumptive child support amount and the reasons for deviating from the CSSA. However, the parties frequently choose not only to deviate from the child support amount calculations, and add-ons such as child care and health care costs, but also to make recalculations of child support an annual or semi-annual event, or to include other items not included within the scope of the CSSA.

In Fasano v. Fasano, 43 A.D.3d 988 (2nd Dept. 2007), the parties included an annual cost-of-living-adjustment (“COLA”), with respect to the child support paid by the non-custodial parent. The Second Department found that the parties to the agreement did not opt out of the CSSA standards with respect to basic child support, but that the COLA provision included in the agreement represented potential future deviations from the CSSA basic child support obligation. The agreement did not state the reasons for including the COLA provisions. The Appellate Division held that the COLA provision represented an opt-out from the CSSA and was directly related to the child support. Since the reasons for including the COLA provision were not included in the agreement, the opt-out was invalid. The court vacated the COLA provision, while the basic child support provision of the agreement was not vacated.

However, not all provisions dealing with financial support of the children are considered to be within the scope of the CSSA. In Cimons v. Cimons, 53 A.D.3d 125 (2nd Dept. 2008), the Second Department held that the obligation to provide for the future college expenses of the children was not part of the parties’ basic child support obligation and therefore was not subject to the CSSA requirement that any deviation from statutorily-mandated child support obligations must be recited and explained in a stipulation of settlement. While the parties’ agreement regarding basic child support violated the CSSA by failing to recite and explain the reasons for the deviation, the provision concerning future college expenses was enforceable. The court held that unlike the basic obligation to provide child support, payment for a child’s college education is not mandatory. Absent a voluntary agreement, a parent might be required to provide support for his or her child’s attendance at college, but the determination of that obligation is dependent upon the exercise of the court’s discretion in accordance with Domestic Relations Law §240(1- b)(c)(7). The court further noted that the determination as to which additional aspects, if any, of the parties’ stipulation must be vacated along with the basic child support provision depends on the circumstances of the particular case and the nature of the obligations addressed in the other provisions of a stipulation. Some provisions may be so directly connected or intertwined with the basic child support obligation that they necessarily must be recalculated along with the basic support obligation. It found that unlike child care expenses and unreimbursed health care expenses, education expenses were not directly connected to the basic child support calculation and did not require the appropriate opt-out language.

The above cases represent the dangers involved any time the parties attempt to either opt-out from the CSSA or attempt to include items outside of the scope of the CSSA in their agreement. Any such agreement must be carefully drafted to make sure that it is not subsequently challenged and invalidated.

Child Support and Credit for College Expenses

Sunday, November 9th, 2008

I am often asked whether there should be a reduction in child support in a situation where the child is residing away from home at college and the parent paying child support is also contributing to the cost of college expenses. Since the child support is generally paid to provide shelter and food for the child, if a parent is paying for a room and board at college, the payor parent should only be paying for shelter and food at a single location. The case law holds that, in the absence of an agreement to the contrary, any such reduction or credit is discretionary with the court.

In Pistilli v Pistilli, 53 A.D.3d 1138 (4 Dept. 2008) plaintiff moved to modify the judgment by “[d]istributing the actual and anticipated college education costs associated with the parties’ children,” specifically the parties’ daughter, between the parties. Pursuant to an oral stipulation of the parties that was incorporated but not merged into the judgment of divorce, the parties “agreed to contribute to [their children's college expenses] as they are then financially able.” The Appellate Division held that the court erred in failing to consider defendant’s maintenance obligation in calculating the percentage of defendant’s contribution to the daughter’s college expenses. After subtracting from defendant’s income the amount of taxable maintenance paid to plaintiff as indicated on the parties’ respective 2005 tax returns, which were used by the court in determining the parties’ respective incomes, it concluded that defendant’s percentage of the combined parental income was 64% rather than 80%, and thus defendant’s pro rata share of the daughter’s college expenses was reduced from 80% to 64%. The Appellate Division rejected defendant’s contention that the court erred in determining that he was entitled to a credit against his child support obligation only in the amount of his pro rata share of the daughter’s college meal plan, holding that a credit against child support for college expenses is not mandatory but depends upon the facts and circumstances in the particular case, taking into account the needs of the custodial parent to maintain a household and provide certain necessaries. Because plaintiff had to maintain a household for the daughter during the daughter’s school breaks and weekend visits, it could not be said that defendant was entitled to a credit for the daughter’s rooming expenses. Nevertheless, inasmuch as the Appellate Division reduced defendant’s pro rata share of the daughter’s college expenses from 80% to 64%, defendant’s child support credit based on the college meal plan had to reflect that reduction and it modified the order accordingly.